The fourth round of funding from the British Governments’ Contracts for Difference scheme is its largest, availing £285M (€334Mn or $377M) per year, aiming to secure 12GW of electricity capacity; more renewable capacity than the previous three rounds combined and including solar and onshore wind for first time since 2015’s first round.
It aims to support offshore wind with £200M per year — to power up to 8M homes — with £24 million initially allocated for floating offshore wind, £20 million on tidal stream projects.
British-based renewable energy projects can now bid for the funding.
The scheme has supported deployment of renewable energy across Great Britain whilst rapidly reducing costs, e.g. the unit price per unit of offshore wind by around 65% between the first allocation round in 2015 and the third in 2019.
“Our biggest ever renewables auction opening today will solidify the UK’s role as a world-leader in renewable electricity, while backing new, future-proof industries across the country to create new jobs […] moving away from volatile global fossil fuel prices, all while driving down the cost of new energy.”
— Kwasi Kwarteng, UK’s Secretary of State for Business, Energy and Industrial Strategy
“More than 16GW of wind could be ready to compete and over 23GW of renewables overall. We could see investment of over £20 billion in this round, creating thousands of jobs and cutting costs for energy consumers.”
— RenewableUK CEO, Dan McGrail
“The previous 3 rounds have allowed us to push forward with the Green Industrial Revolution and this round will take us further and faster than ever before while continuing to drive down costs for consumers.”
— Greg Hands, UK’s Minister of State for Business, Energy and Clean Growth
The Contracts for Difference fourth allocation round will close to applications on 14 January 2022, with the final results of the auction expected to be announced in Spring-Summer 2022.
Contracts for Difference are 15-year private law contracts between renewable electricity generators and Low Carbon Contracts Companies, a government-owned company managing CfDs at arm’s length from government contracts are awarded in a series of competitive auctions, known as allocation rounds, which have been run approximately every 2 years.
In the auction process, the lowest price bids within each pot and/or ringfence are successful.
Biggest ever renewable energy support scheme opens, UK Government, 2021-12-13